Raghubir Singh v. Income Tax Officer, Ward 4(3), Amritsar And Another

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CWP No.9831 of 2013Date of decision: 21.4.2014 Raghubir Singh -----Petitioner Vs. Income Tax Officer, Ward 4(3), Amritsar and another ----Respondents CORAM:- HON’BLE MR. JUSTICK AJAY KUMAR MITTALHON'BLE MR. JUSTICK JASPAL SINGH Present: Mr. Sandeep Goyal, Advocate for the petitioner. Mr. Denesh Goyal, Advocate for the respondents. Ajay Kumar Mittal,J 1.Prayer in this petition filed under Articles 226/227 of theConstitution of India is for quashing the orders dated 30.12.2011 and4.3.2013, Annexures P.5 and P.8 passed by respondents No.l and 2respectively raising a demand of |-5,39,275/- including interest of |=2,48,280/- under Section 234-B of the Income Tax Act, 1961 (in short, “theAct’) for 93 months against the petitioner. |A few facts relevant for the decision of the controversyinvolved, as narrated in the petition, may be noticed. The petitioner is anagriculturist. The dispute in this present case relates to the sale of landmeasuring 7 kanals 8 marlas by the petitioner, which was purchased by himon 21.7.1995. The cost of acquisition at the time of purchase of the saidland was =a2,10,000/-. The petitioner had also incurred expenses relating toearthwork and fencing etc. to the tune of a4,70,000/-. According to thepetitioner, taking the indexed cost as per the index for the impugned year,the total cost of acquisition worked out to be =a12,79,417/-. On 13.5.2013, CWP No 9831 of 2013 the said land was sold forzy4 lacs by the petitioner vide registered sale deeddated 13.5.2003, Annexure P.2. The value of land for the purpose of stampduty was worked out at.=13,87,500/- and stamp duty of =a§3,250/- wasaffixed on the same. The petitioner filed his return for the year in question|which was below the taxable limit. However, his case was reopened underSection 147 of the Act and notice dated 24.3.2011 was issued to thepetitioner. The petitioner appeared and pleaded that he had sold the entireland of 7 kanals 8 marlas and not | kanal as alleged. It was also urged thatthe cost of acquisition for the entire land worked out to be.LT12,79,417/-and, therefore, the proceedings should be finalised accordingly. TheAssessing Officer vide order dated 30.12.2011, Annexure P.5 framed theassessment and calculated the taxable capital gain on=13,34,842/- by takingthe land sold to be 1 kanal only. After determining the taxat |42,66,968/- andinterest under Section 234-B of the Act to the tune of.42,48,280/- and underSection 234-A of the Act for=a24,027/-, the total tax demand was raised tothe tune of v5,39,275/-. Agegrieved by the order, the petitioner filedrevision petition under Section 264 of the Act before the Commissioner ofIncome Tax, Amritsar (in short, “the CIT’’), inter alia, pleading that he hadsold his entire land and not only | kanal. It was further averred thatprinciples of natural justice had not been followed while passing theassessment order. Vide order dated 4.3.2013, Annexure P.8, the revisionalauthority dismissed the revision petition. Hence the present petition by thepetitioner. 3]Mr. Gurmeet Singh, Income Tax Officer (Tech.), Amritrsar 1spresent 1n person in pursuance to the order passed by this Court on243270014. 4 We have heard learned counsel for the parties and perused the record.. 4 Learned counsel for the petitioner submitted that the sale deedwas relating to 7 kanals 8 marlas of land of which the value was estimatedby the Registrar for stamp duty purposes at-13,87,500/- whereas theAssessing Officer had taken the land sold to be measuring | kanal only. 6.It was not disputed by the learned counsel for the revenue thatthe sale deed was for 7 kanals & marlas of land. ToThe Assessing Officer as well as the CIT had taken the landsold to be measuring | kanal instead of 7 kanals 8 marlas. In suchcircumstances, the orders passed by the Assessing Officer and the CITcannot be legally sustained. 4 We have heard learned counsel for the parties and perused the record.. 4 Learned counsel for the petitioner submitted that the sale deedwas relating to 7 kanals 8 marlas of land of which the value was estimatedby the Registrar for stamp duty purposes at-13,87,500/- whereas theAssessing Officer had taken the land sold to be measuring | kanal only. 6.It was not disputed by the learned counsel for the revenue thatthe sale deed was for 7 kanals & marlas of land. ToThe Assessing Officer as well as the CIT had taken the landsold to be measuring | kanal instead of 7 kanals 8 marlas. In suchcircumstances, the orders passed by the Assessing Officer and the CITcannot be legally sustained. & Accordingly, while setting aside the impugned orders dated30.12.2011 and 4.3.2013, Annexures P.5 and P.8 respectively, the matter 1sremitted back to the Assessing Officer to pass fresh order after affording anopportunity of hearing to the petitioner in accordance with law. The petitionstands allowed. (Ajay Kumar Mittal)Judge April 21, 2014 (Jaspal Singh)Judge